Sears Slims Loss in Second Quarter
August 16, 2012,
HOFFMAN ESTATES, Ill.-In a second quarter that featured continuing declines in sales, Sears Holdings nevertheless was able to reduce its net loss for the quarter to $132 million from the $146 million in red ink reported in last year's second quarter.
Lou D'Ambrosio attributed the improved bottom line to Sears Holdings' efforts to reduce expenses and expand margins. Selling, general and administrative expenses were down 6.3 percent in dollars and flat at 25.7 percent of total net sales. Gross margin rose 100 basis points to 26.7 percent.
Net sales for the quarter, which ended on July 28, finished 6.6 percent behind sales in last year's second quarter, totaling $9.5 billion. Total sales at Sears stores were off 5.2 percent in total and 2.9 percent on a same-store basis. At Kmart, total sales fell 6.9 percent in total and 4.7 percent in comparable-store sales.
In terms of product categories, consumer electronics had the largest impact on the sales decreases due to reduced prices. Lawn and garden also had a negative effect due to drought conditions throughout the United States. Sales of apparel and pharmacy products (in Kmart's case) were also off in the quarter.